Labor Cost Management Is Key to Coping with Sequester at Agencies

Labor Cost Management Is Key to Coping with Sequester at Agencies

This may be small solace to airline passengers waiting out delays
at airports in Los Angeles and New York, but the general consensus
in Washington is that the real pain from budget cuts under the
sequester may not be felt until the end of the summer or even next
year. That"s because managers of federal agencies are using whatever
flexibility they can, according to officials at agencies and unions
representing workers, to cut down on furloughs to minimize
disruptions in services.

It"s a common-sense approach, but for managers at federal
agencies it also presents something of a double-edged sword: The
better they can patch together solutions over the coming weeks, the
more palatable the automatic, across-the-board spending reductions
will appear to the public. And that means agencies will be more
likely to have to live with the tighter budgets and smaller staffs
that the sequester has brought them.

"The more pain, the more transparent it is that the cuts are
problematic,' said Sharon Parrott, vice president for budget policy
and economic opportunity at the Center on Budget and Policy
Priorities.

The recent budget control laws (PL 112-25, PL 112-240) lowered
the cap on regular discretionary spending to about $984 billion in
fiscal 2013 from $1.043 trillion in the previous budget year and is
slated to knock it back to $967 billion for fiscal 2014.

The workforce is the most obvious target for those cutbacks.
Total personnel costs, including pay and benefits, were $458.4
billion in fiscal 2012, according to the Office of Management and
Budget. That"s up from fiscal 2011, when total personnel costs were
$432.6 billion, of which $299.57 billion went for civilian
employees.

That"s why management of labor costs, by far the largest single
cost within government operations, is central to coping with the
sequester at government agencies.

That was evident to the traveling public in the past week, as the
first furloughs at the Federal Aviation Administration led to
lengthy delays at Los Angeles International and New York-area
airports. FAA data showed that there were almost double the number
of delays on Monday as there would have been without the furloughs.
About 1,200 were attributable to staffing reductions, the agency
said in a statement.

Experts say those delays may be only the start of problems at
agencies as they roll out furloughs, one day every two weeks for
employees at most agencies and perhaps once a week for workers at
the Department of Defense, the single largest federal employer.

"We"re seeing some broad outlines, but we"re not seeing the
negative impact right now,' said Peter Winch, deputy director of
field services at the American Federation of Government Employees,
which represents about 650,000 workers.

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April 24, 2013, 3:41 p.m.The next outcry could come May 24, when
the IRS begins implementing furloughs for 89,000 employees, forcing
the shutdown of the agency's toll-free help and Taxpayer Assistance
Centers.

"We settled on having uniform furlough dates for everyone and
closing down agency operations entirely," acting IRS Commissioner
Steve Miller wrote in a memo to workers. …

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